Kenya’s inflation is poised for a further downturn, propelled by a significant plunge in fuel costs, offering respite to consumers contending with an elevated cost of living.
The most recent fuel price revision shows that a liter of super petrol in Nairobi now retails at Sh212.36, down from Sh217, while diesel is priced at Sh201.47, compared to its previous Sh203.47, according to figures released by the Energy and Petroleum Regulatory Authority (EPRA).
This decline in fuel costs, attributed to a dip in international crude oil prices, complements the recent reduction in prices for essential commodities such as maize flour and cooking oil.
As food constitutes a substantial portion of the inflation basket, these developments become crucial in influencing the overall cost of living in the country.
Data from the Kenya National Bureau of Statistics (KNBS) on consumer retail prices reveals an easing of inflation from 6.9 percent in October to 6.8 percent in November, driven by a decline in food prices owing to favourable weather conditions.
The diminishing cost of fuel is poised to have a cascading effect, with manufacturers, power producers, and service providers expected to incorporate these cost reductions, further contributing to the ongoing decline in inflation over the last two months.
The anticipated reduction in fuel costs is expected to extend to the electricity sector, as bills are projected to align with the lower fuel expenses, impacting the fuel cost charge, which holds a predominant share in electricity billing.
The persistent challenge of the high cost of living has been a focal point for President William Ruto’s government, contending with public dissatisfaction and demonstrations, particularly led by opposition leader Raila Odinga.
In a recent development, the opposition cautioned the Energy and Petroleum Regulatory Authority against any prospective increase in fuel costs during the monthly review, typically conducted on the 14th day of each month.
Notably, activists have taken legal action against EPRA, accusing the regulatory body of maintaining fuel prices above Ksh200 per liter, despite the global decline in costs.
The current reduction in fuel prices is anticipated to alleviate some of the economic pressures faced by consumers, providing a crucial reprieve in the ongoing economic landscape.